Thursday, June 1, 2017

United States Bid for the 2026 World Cup

Jaeger Hoang
United States Bid for 2026 World Cup
Every four years, 32 nations put forth their best soccer players to compete in the World Cup. The FIFA World Cup is one of, if not the biggest sporting event in the world. Hundreds of thousands of people come from all across the world in order to attend the high class games and to have the once in a lifetime experience in the World Cup atmosphere. With the bids for the 2018 and 2022 World Cups already decided for Russia and Qatar, the United States has proposed to team up with Canada and Mexico for a bid at hosting the 2026 event. If North America does in fact win the bid and end up hosting the World Cup, the country’s economies will be impacted greatly.
The positive externalities of hosting are plentiful. Although the costs of building the stadiums will be very high, the opportunities provided by them will bring in lots qualities that attribute to economic growth. Many jobs will be created through the construction, vendors, and maintenance of the stadiums. Along with job creation the revenue generated by stadiums will also be a huge plus to having to build stadiums. Ticket, memorabilia, and concessions sales will all contribute to that revenue and with the amount of fans attending the games, the stadiums will become profitable in a fairly short amount of time. These sources of income can also continue after the World Cup is over through lending the stadiums to local pro teams and hosting other entertainment events like concerts. According to FIFA host regulations, the countries hosting are required to build stadiums with capacities of 40-80 thousand people. With the capacities so high, more people are bound to attend games and spend money on the main sources of income. Taking the average ticket prices and multiplying it by the capacity of the stadium brings the total ticket sales for one single game to about 36 million. For the 2026 World Cup there will be 80 games and the total ticket sales peaks at a total of over 2 billion (Liu Economics). These numbers are just based on averages so the potential total income from ticket sales alone could be even higher. One of the biggest ways the World Cup can benefit the country’s economy is by stimulating and increasing the amount of customers seen by surrounding businesses. The event, like said before, brings in hundreds of thousands of people from across the world. Their presence in the country will only mean that there are more customers to serve. Hotels and restaurants are two types of businesses that will be affected the most by hosting. Everyone will be looking for a place to stay in the US and they will be looking for the best places to eat in the hosting cities. These businesses will in turn see dramatic increases in income, which will in turn also increase the profits they make. Even after all of the international visitors leave, people will still be going to the host cities to go to the entertainment events at the stadiums, so surrounding businesses will still experience higher rates of traffic than before the stadiums will be built.
Along with the positives, there will also be some major negative externalities for the hosts. In order to build the stadiums, local and national governing bodies will need money to pay all expenses off. This means that citizens of the areas around the stadiums will most likely find an increase in tax rates. Whether it be income tax, property tax, sales tax, or whatever other taxes that are most common in the area, they will all be increased in order to account for construction and maintenance. Disagreements over the taxing will become a problem, but it is necessary in order to make the World Cup a reality in North America. Also the high concentrations of international World Cup fans will make cities much more crowded and busy than before. Traffic will increase both on the roads and walkways resulting in increased times of travel. Citizens will again be affected as their daily routines will need to change in order to accommodate for the dramatic increase in traffic. Finally the cost to run the stadiums is very high. If the cities are to maintain and continue using the stadiums even after the World Cup has concluded, then tax rates and other expenses will remain higher than before. The government will need to cover the deficits caused by the construction and make sure that the stadiums are all paid off, another thing people will disagree on greatly.
Although there are some negative externalities caused by hosting the World Cup, the positives provided for the North American economy are far more in quantity and effectiveness. The increase in taxing and the high traffic that will be brought by the World Cup will be made up for by the jobs that will be created, the dramatic sales increase that will occur, the stimulation of surrounding businesses, and the overall attention that will now be brought to the nations. All in all, the World Cup will be a big positive to the economies of North America.
Works Cited
"Concepts: USA + Canada Joined Bid for 2026 World Cup." FOOTY FAIR. N.p., n.d. Web. 01 May 2017.
Das, Andrew. "U.S., Canada and Mexico Announce Shared Bid for 2026 World Cup." The New York Times. The New York Times, 10 Apr. 2017. Web. 01 May 2017.
Goff, Steven. "Analysis | United States, Canada and Mexico Joint Bid Will Be Favored to Land 2026 World Cup." The Washington Post. WP Company, 09 Apr. 2017. Web. 01 May 2017.
Rosenblatt, Ryan. "What Will the next American World Cup Look Like?" SBNation.com. SBNation.com, 15 July 2014. Web. 01 May 2017.
Sport, PA, Stephan Uersfeld, ESPN Staff, Associated Press, Doug McIntyre, and Tom Marshall. "U.S., Mexico and Canada Officially Launch Bid to Co-host 2026 World Cup." ESPNFC.com. N.p., n.d. Web. 01 May 2017.
Wahl, Grant. "USA's Joint Bid for World Cup '26 Could Come in April." SI.com. Sports Illustrated, 25 Mar. 2017. Web. 01 May 2017.

14 comments:

  1. It is true that there are both positive and negative externalities to hosting the World Cup but in my opinion the marginal benefit outweighs the marginal cost. Although it will be louder and there will be more traffic, the amount of money and jobs that will be created by this event is so beneficial to the economy that it outweighs the negatives.

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  2. Any large event, involving sports or not, will bring in various turns in our nation’s economy. However, these large events will bring in great deals of money due to their size and the amount of tourists that travel from across the world. Sure, it may cause an increase in taxes to build these new stadiums for the World Cup, however that will turn around in the future because of the opportunity cost of this situation: more spending at local businesses and more available jobs. This demonstrates how these positive externalities will overrule the negatives. Each city where the World Cup would be involved in would gain some profit by the millions of people who are traveling to see each game. This will help our nation's economy in the long run as all of these businesses and cities will gain some revenue, even though that would have to occur after the negatives.

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  3. As a world cup fan, I believe the positives of hosting the 2026 world cup far outweigh the negatives. If the cost of building arenas were split between the United States, Canada, and Mexico, the cost per person in each country would be very minimal. Thus, taxes would not be raised to the magnitude that a country like Qatar might see. Furthermore, it would just be a lot of fun to have the world's largest soccer tournament being played in our metaphorical backyard, so I am all for it.

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  4. Many jobs will be created and lots of money will flow through the economy. There will be lots of tickets purchased would could bring in even BILLIONS of dollars just from these sales. Including things like concessions, memorabilia, etc., this would benefit the economy greatly because of the high amount of money that will flow through the economy. Lastly, wherever this is hosted will gets lots of recognition, a good reputation, etc. for hosting such a likely successful World Cup Event.

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  5. I do believe construction of the world cup is helpful to the economy, however my concern with the construction is: will it be used after? Every four years when the Olympics happens, jobs are created and used up until the end of the events. As long as the stadium stays in frequent use, then it will with hold jobs and keep the economy well in tact, and be a positive externality for everyone.

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  6. I agree that the positive externalities of hosting the 2026 World Cup greatly outweigh the negatives. The fact that Mexico, the United States, and Canada are teaming up to host the event means that taxes on Americans will be slightly decreased if the cost is split between all three countries. In addition, due to inflation, by 2026 the income from the event will most likely be at record highs. Other positives include the increase in the number of jobs available to citizens, and the benefits for transportation systems within the country. Because the location of the games would be closer to home, more people will be willing to attend. So not only would local bus systems benefit where the games are located, but airlines and trains across the country would as well!

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  7. In my opinion the marginal benefit outweighs the marginal cost when comparing the positive and negative externalities. Having the 2026 World Cup here in the United States will have a huge impact on our economy. This would bring in a lot more revenue as fans of soccer across the world come into this country to see the world cup. Things got to get worse before they can get better. Which after things get worse such as paying for all the fees, the auction, and the stadium, the businesses and companies will gain a lot of revenue from the tourist which will help our economy in the long run.

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  8. This is the first time I am hearing of the possibility of the world cup being held here in the United States. That's pretty cool. I think the positives of hosting the games would outweigh the negatives. If people travel all over for these games imagine the amount of money spent here during that time. People would be willing to spend more money than usual for this once in a lifetime opportunity. Like Carson said in his comment above, I agree that there are benefits of splitting the costs with Canada and Mexico. By having two co-signers we are not in this alone and taxes will not be as high for the citizens.

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  9. I never realized the impact the world cup has on the economy. I'm not big into soccer so I was never one to really know much about the world cup. The number of games played and stadiums needed is crazy. If North America were to host this the economy would definitely see an increase, which may help reassure many citizens. While I understand that there are many games that need to be played I feel like building the large number of stadiums may hurt the economy of those countries, because a lot of them have other issues they could be fixing instead of adding more buildings that will need maintaining. The opportunity cost is definitely going to be weighed to decide whether or not this will overall boost the economy, but I think that in the end this would be a great chance to increase tourists and profits across the nation.

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  10. There is no denying that stadiums always generate a large amount of revenue -- despite how much they might cost to build and maintain. One only needs to look at Miller Park in Milwaukee to see as much. When it is not serving as the host of a professional baseball team -- which in itself generates a great deal of money -- it serves as a place for concerts, games and even races. Local counties like ourselves may have to pay extra in taxes to fund the stadium, but there is no questioning that the stadium has provided more benefits than it has drawbacks -- which these soccer stadiums will certainly do if they are constructed.

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  11. Hosting the world cup would highly benefit the economy, it would bring in millions if not billions of dollars to the economy, its a big deal when profits could be as high as those. While funding the world cup would yes be expensive, there's no doubt that the profits made will be more than the costs. Building large stadiums do however hurt the people who live in those areas as taxes increase. Personally I feel the people who live near the stadium won't like it, but the people who don't will benefit as it helps the economy as a whole.

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  12. The amount of revenue produced from the World Cup is astonishing. One country could make a fortune off of just hosting it. Although it is true that it will cost a lot to build the stadiums to host the events, the opportunity cost is getting possibly over triple the cost to host the World Cup.

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  13. I've known for a while the popularity that soccer carries, especially outside of the United States. Further it goes without mentioning that by hosting such a massive event such as World Cup, you greatly maximize the potential for economic prosperity in a sporting setting. A great impact on the economy would be seen, and taking into account the mentioned use of the stadium further after Cup would also be beneficial in job creation, and continued economic impact. Although it is a large sum of money, it is an investment over time, and one that will benefit the economy overall.

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  14. Some negative externalities are similar those of the Rio Olympics in Brazil. Brazil's government spent billions of dollars on building stadiums and paying for Olympic expenses. Now, without the Olympics those stadiums are unusable because they are simply to big for any event that would occur in the country. This same thing could happen with the world cup stadiums being built. They use these for a portion of the year so the economy is only stimulated by the revenue for a short period before the billions of spending to build comes back to haunt the government. It will be interesting if the world cup causes the same effect as the Olympics.

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